subject: MONEY MONSTER [print this page] MONEY MONSTER MONEY MONSTER
In the business world, some businessmen enjoy a long run of success in their first quarter of business establishment. After sometime, everything turns into a nightmare, like a strained elastic wire at its breaking point. A business that started well with 50% profit, and still increased it to 80% in their successful years, suddenly, starts planning on how to reduce the number of staffs, and cutting their salaries to half to solve their problem of finance. Something must be wrong. It is possible for a company to set the target of making one billion dollars in 6 months, and still earn it, but going ahead to lose it in one year.
I call this MONEY MONSTER manifesting itself in the mismanagement of business resources, and miscalculation of business trends. It is painful that in the recent ECONOMIC MELTDOWN, so many business owners lost their fortune. Some even sold their companies to save what is left of them. The news was that the meltdown affected everybody, and the government started making provisions for cash to help the masses.
While some were busy losing some were busy winning. In the same year of the economic meltdown, winners had a 20% increase in their profit which made them see no truth in the news. In business, certain calculations have to be made about the future to balance the equation of INCOME and EXPENSE. Success has to be directly proportional to incme, and always on the increase.
For a champ to remain a champ, he needs to be continually reviewing his strengths and weaknesses, his future plans, which includes personal and non-personal issues. In the days to come, new expenses are going to arise, new improved problems, and new faces to be managed.
THE ACCURATE ESTIMATION OF THE COST OF THESE INPUTS IS THE MINIMIZATION OF THE COST OF ANOTHER ECONOMIC MELTDOWN.
Now, citing the success of Mckensson Corporation, the world's largest wholesale distributor in U.S, which started as a drug wholesale distribution industry, met the money monster through mismanagement in 1974, when the management board merged it with Foremost Dairy of California, two different products in one. Now, the first lesson, "avoid getting into unrelated business trying to diversify. It could cause you to lose focus." This problem was solved when the new management of Mckensson restructured the company into four operating divisions, with each unit becoming leaders in their industries. Furthermore, in 1983, they divested from its non-health related business and focused more on its traditional business of wholesale distribution of Health care products. They succeeded in improving productivity, concentrating only on profitable businesses, and reviewing their future plans from their beginning and the present.
It feels good to win, and to do that, take care that the money monster won't crumble your business. It comes as a bad manager in a good manager's cloth. Keep winning.
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